@article{ART002443756},
author={OUH, CHANGSU and Jongkook Jung},
title={A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS},
journal={Journal of Insurance and Finance},
issn={2384-3209},
year={2019},
volume={30},
number={1},
pages={71-106},
doi={10.23842/jif.2019.30.1.003}
TY - JOUR
AU - OUH, CHANGSU
AU - Jongkook Jung
TI - A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS
JO - Journal of Insurance and Finance
PY - 2019
VL - 30
IS - 1
PB - Korea Insurance Research Institute
SP - 71
EP - 106
SN - 2384-3209
AB - Using the fair value approach for IFRS 17 transition, this study directly computes the contractual service margin(CSM) and the insurance contract liability under IFRS 17 for representative Whole Life product contracts, and then compares them with the current reserves. Because a non-performance risk should reflect the discount rate used in fair value approach, the fair value at the transition date is lower than the fulfillment cash flow under IFRS 17, and so CSM is equal to zero. As a result, IFRS 17 liability of the fixed interest whole life insurance contract(5.5% of the assumed rate) is increased by 8.0%p compared to the current reserve, but IFRS 17 liability of the interest sensitive whole life insurance contract(3.75% of the assumed rate and 2.5% of the minimum guaranteed rate) is decreased by 4.5%p at the transition date. This study also carries out the sensitivity analysis for changes of main variables.
KW - IFRS 17;Fair Value Approach;Non-performance risk;Whole Life Insurance Contract
DO - 10.23842/jif.2019.30.1.003
ER -
OUH, CHANGSU and Jongkook Jung. (2019). A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS. Journal of Insurance and Finance, 30(1), 71-106.
OUH, CHANGSU and Jongkook Jung. 2019, "A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS", Journal of Insurance and Finance, vol.30, no.1 pp.71-106. Available from: doi:10.23842/jif.2019.30.1.003
OUH, CHANGSU, Jongkook Jung "A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS" Journal of Insurance and Finance 30.1 pp.71-106 (2019) : 71.
OUH, CHANGSU, Jongkook Jung. A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS. 2019; 30(1), 71-106. Available from: doi:10.23842/jif.2019.30.1.003
OUH, CHANGSU and Jongkook Jung. "A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS" Journal of Insurance and Finance 30, no.1 (2019) : 71-106.doi: 10.23842/jif.2019.30.1.003
OUH, CHANGSU; Jongkook Jung. A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS. Journal of Insurance and Finance, 30(1), 71-106. doi: 10.23842/jif.2019.30.1.003
OUH, CHANGSU; Jongkook Jung. A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS. Journal of Insurance and Finance. 2019; 30(1) 71-106. doi: 10.23842/jif.2019.30.1.003
OUH, CHANGSU, Jongkook Jung. A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS. 2019; 30(1), 71-106. Available from: doi:10.23842/jif.2019.30.1.003
OUH, CHANGSU and Jongkook Jung. "A Study on the Fair Value Calculation of Insurance Contract Liability for Whole Life Products under IFRS" Journal of Insurance and Finance 30, no.1 (2019) : 71-106.doi: 10.23842/jif.2019.30.1.003
